CMS update

The CMS last week proposed changing the way it pays physicians, including significantly increasing reimbursements for evaluation and management (E/M) services.

The proposed changes are based on recommendations by the relative-value scale update committee (RUC), which makes recommendations to CMS on RVUs and includes representatives from the College and other medical groups. According to a June 21 CMS news release, the proposed rule calls for a review of physician RVUs as well as for changing the way practice expenses are calculated.

The recommendations represent the most comprehensive changes ever proposed to E/M services and would substantially increase payments associated with the most frequently billed physician services, according to the CMS news release. For example, the work component for RVUs would increase by 37% for an intermediate office visit, 29% for a moderately complex visit and 31% for a moderately complex hospital visit.

These work component increases translate into actual national average payment increases of 12.8% for an intermediate office visit, 9% for a moderately complex office visit and 13.7% for a moderately complex hospital visit. The College, a key player in developing the recommendations, asked the CMS in January 2005 to include E/M codes in its five-year review, said a June 22 ACP news release.

Doctors who see the most Medicare patients in face-to-face E/M visits would receive the largest increases while some physicians who provide fewer E/M services would experience reductions. Work RVUs account for about $35 billion in Medicare's physician fee schedule payments, or more than one-half of all Medicare payments to physicians, the CMS release said.

The CMS also proposed changing the way it calculates practice expenses, said the release, including direct and indirect costs associated with specific services.

The practice expense change would adopt a "bottom-up" methodology for calculating direct costs, such as using procedure-level data for clinical staff times, the CMS release said. It would also use practice expense survey data for certain specialties and eliminate the "non-physician work pool" that has been used to calculate expenses for services without work RVUs, in favor of using standard practice expense methods.

Public comments on the proposed rule, which will appear in the June 29 Federal Register, will be accepted until Aug. 21 and a final ruling is expected to be issued in November 2006. The RVU changes, if implemented, will take effect Jan. 1, 2007, while the practice expenses would be phased in over four years.

The business of medicine

Physicians' net income, adjusted for inflation, dropped by about 7% between 1995 and 2003, with primary care doctors leading the trend with a 10.2% decline.

The downward spiral has likely fueled physician unwillingness to provide charity care or fill volunteer positions, said a June 22 news release from the nonprofit think tank Center for Studying Health System Change (HSC), which conducted the survey that produced the findings. In contrast, other professionals during the same period saw their income increase by about 7%.

While primary care physicians saw the steepest decline in real income during the study period, surgeons were No. 2 with an 8.2% drop, said the news release. Real income of medical specialists, however, held steady.

Income declines have been driven by flat or reduced fees paid to doctors by public and private payers as well as by more physicians choosing medical specialties over primary care, said the news release.

Other survey highlights included:

The proportion of medical specialists increased from 32% to 38% while the proportion of primary care physicians and surgical specialists each declined by about 3% over the study period.

Medicare payments increased by 13% for physician services from 1995 to 2003, compared with an inflation increase of 21%, while private payment rates have fallen from 1.43 times Medicare fees in 1995 to a fee ratio of 1.23 in 2003.

The volume of physician services increased between 1999 and 2003 by 6% for minor procedures, 4% for office visits and 3% for major procedures.

However, the release noted that physicians are still among the highest-paid professionals. Average net income was about $203,000 for all physicians and $272,000 for surgeons—the highest-paid of all physicians—in 2003.

ACP has been strongly advocating for payment reform, pointing out that loss of real income is fueling an imminent collapse of the nation's primary care network.

More physicians are offering innovative scheduling and more convenient hours as a way to retain patients in an era when concerns about cost and convenience have sparked the rise of medical clinics in retail outlets.

The June 24 New York Times pointed out that market forces are pushing physicians to make office hours more accessible to patients. Among trends in office innovations were the following:

Open access, or same-day scheduling. Some physicians now leave as much as 70% of their appointment times open to accommodate patients who call that day for an office visit, according to ACP's Michael S. Barr, FACP, Vice President for Practice Advocacy and Improvement, who is quoted in the article—or take patients on a walk-in basis. Such systems increase patient satisfaction and cut down on the number of no-shows.

Lunchtime clinics. Instead of closing their office for lunch, some physicians are offering lunchtime clinics for quick office visits, a convenience for patients that helps keep offices competitive with the "minute clinics" that are increasingly springing up in retail stores. Such minute clinics are staffed by nurses who are supposed to be supervised by physicians.

Lunchtime access. In offices not offering quick-visit lunchtime clinics, physicians are still staying open to treat patients who call in that morning, postponing hospital rounds and their own lunchtimes until later in the day.

The article noted that such innovations are in keeping with ACP's "advanced medical home" model of office-based care, which advocates for internists to provide patient-centered, physician-guided care – and for reimbursement policy to support the medical home model.

Clinical news in the headlines

The World Health Organization (WHO) last week confirmed the first case of human-to-human transmission of avian flu.

The virus—a slightly mutated version of the A(H5N1) strain—was passed from a son to his father in Sumatra, both of whom died, according to the June 24 New York Times. While the mutation does not mean the virus is now more easily transmitted to humans, officials said the case is the first to be confirmed where a patient was not infected through contact with infected birds or poultry.

More than 200 people have been infected with the virus worldwide, while the father and son were two of seven infected family members. The first five members had strains of avian flu identical to those found in birds, while the sixth victim—the 10-year old son—had a slightly mutated version. A WHO epidemiologist quoted in the article said the boy's father had cared for him in the hospital without "proper protection" and was infected with the mutated virus.

No evidence supports the idea that the mutated virus can now be more readily passed among people, the epidemiologist stressed. The WHO has followed more than 50 relatives and neighbors of the family for a month and has not identified other cases of infection.

A study released last week reported that consistent use of condoms significantly reduced the incidence of human papillomavirus (HPV)—which can cause warts and cervical cancer—among a group of female college students.

In the study, 82 women between age 18-22 who had recently become sexually active kept diaries of their sexual encounters and were tested for HPV every four months. The incidence of genital HPV infection was 37.8 per 100 patient years at risk among women whose partners always used condoms over eight months compared with 89.3 per 100 patient years at risk among those who used condoms less than 5% of the time. The results appear in the June 22 New England Journal of Medicine.

The findings are significant because the recently approved HPV vaccine protects against just four strains of the virus, said the June 22 New York Times. These findings indicate that consistent condom use may help prevent infection with other strains of the virus.

A number of previous studies had conflicting results about condoms' effectiveness in preventing infection, said the New York Times. In 2000, a government panel concluded that there was insufficient evidence about whether condoms helped reduce the risk of sexually transmitted diseases, with the exceptions of AIDS, among men, and gonorrhea.

The research also illustrates the barriers to conducting research on condoms, said the New York Times. That's because HPV infections can be transmitted by other than vaginal or anal intercourse as well as the difficulty of recruiting newly sexually active couples to engage in a research study.

Results from the Women’s Health Initiative (WHI) study found that calcium and vitamin D supplements did not reduce women’s risk for fractures or colorectal cancer.

In the study, involving a total of 36,282 postmenopausal women age 50-79, participants were assigned to take 500 mg of calcium carbonate and 200 IU/d of vitamin D twice daily, or placebo. Women in the placebo group were allowed to continue personal use of supplements. After seven years, researchers found that the two groups did not differ for their risk of fractures or colorectal cancer and that the supplements increased the risk of kidney stones. The study is abstracted in the July-August ACP Journal Club.

There are several reasons why the trial might have underestimated the potential benefits of supplements, said Journal Club reviewer Robert H. Fletcher, MACP, professor emeritus at Boston's Harvard Medical School. For example, women in the trial had already been taking substantial amounts of calcium and vitamin D, more than half were taking hormone therapy, and most were at low risk for fractures.

Dr. Fletcher also noted that the dose of vitamin D given to participants was below the level that other trials have shown to be effective (700-800 IU/d). At the same time, 40% of women in the intervention group did not take the recommended supplements. And in terms of colorectal cancer, he said, the follow-up period may have been too short to show any protective effect as most cases of this type of cancer take 10 or more years to develop.

Subgroup analyses suggest a small protective effect for fractures, he added, with women in the intervention group having 12% fewer hip fractures. The protective effects were greater in women who were older, not falling and compliant with the assigned treatment.

The trial should not change the way clinicians view these supplements, Dr. Fletcher said. Calcium and vitamin D should still be thought of as having a small protective effect on postmenopausal fractures, and calcium might be included in a colorectal cancer prevention program in combination with other factors such as exercise, diet and smoking cessation. However, for women at high risk for fractures, more powerful drugs, including hormone therapy, bisphosphonates, calcitonin and parathyroid hormone are better options.

ACP news

The College has come out strongly for giving hospitals and physicians more time to adjust to proposed changes to the Medicare hospital inpatient payment system. ACP is also asking the CMS to phase in those changes when they become final—and not to exempt residents' didactic services from Medicare graduate medical education funding.

In a letter dated June 12 and sent to the CMS administrator, Joseph Stubbs, FACP, Chair of ACP’s Medical Service Committee, stated that in general the College supports changing hospital payments from a charge-based to a cost-based system and adding a severity adjustment component to the payment system, as proposed by the CMS. Those changes, he wrote, will make inpatient payments more accurate.

However, he noted that the proposed changes would have a major impact on hospital revenue and will affect how hospitals use resources and establish priorities.

As a result, Dr. Stubbs recommended the following:

giving hospitals and providers additional lead-time to understand the potential effects of the proposed system and to potentially improve on CMS' proposed payment methodology before implementation. If finalized, the rule is supposed to be implemented in fiscal year 2007.

phasing in the new cost-based and severity-adjusted system.

publishing an interim rule rather than a final rule to allow for further comments.

In addition, Dr. Stubbs asked the CMS to rescind a clarification in the proposed rule that would exclude residents' time spent on didactic activities—such as journal clubs and lectures—from being used to calculate direct and indirect graduate medical expenses.

Such a change would penalize residency programs that offer non-hospital based training opportunities. "This is particularly poor public policy," Dr. Stubbs wrote, given the impending shortage of primary care physicians and the need to help train residents in non-hospital-based care.

Maintenance of certification

The ABIM and the American Hospital Association last week announced the release of a new Web-based practice improvement module geared to hospital-based care. The module, which was also developed with the participation of ACP and the Society of Hospital Medicine, is now available to internists engaged in the ABIM's maintenance of certification process.

The module allows physicians to review current clinical practice guidelines for caring for patients with heart attack, heart failure and community-acquired pneumonia and compare those to their own hospital's practice. The module uses data collected by hospitals through public-reporting initiatives from the CMS and national hospital associations and organizations.

Physicians are encouraged to complete the module in collaboration with an interdisciplinary quality improvement team, according to an ABIM news release.

Fellowship opportunities

Physicians interested in conducting original health policy research in Australia are invited to apply for a fellowship through the Commonwealth Fund. The deadline for applications is Aug. 15.

The Packer Policy Fellowships are available to mid-career professionals, including physicians, to spend up to 10 months in Australia conducting original research and working with leading health policy experts.

Applicants must be U.S. citizens and must submit a formal application, including a project proposal. Projects must be of mutual policy interest in both Australia and in the U.S., and could relate to health care quality and safety, workforce and sustainability issues, and the private/public insurance mix.

More information in on the Commonwealth Fund Web site, or contact the Commonwealth Fund's Robin Osborn at 212-606-3809 or via e-mail.

Test yourself

A 24-year-old woman undergoes routine evaluation. She is pregnant at 12 weeks' gestation. Medical history is notable for homozygous sickle cell anemia (Hb SS). She has had multiple uncomplicated painful crises treated at home with hydration, nonopioid analgesia, and incentive spirometry. Following a physical exam and lab studies, what is the most appropriate management?

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